The House yesterday approved a free-trade agreement with Australia, brushing off concerns that the pact would limit importation of cheaper generic drugs, and could hurt beef and dairy industries.
The agreement, if passed by the full Senate, would be the United States’ first with a developed nation since a U.S.-Canada pact in 1989 and the first initiated and approved into law during President Bush’s administration.
The House voted 314-109 for the agreement, which would immediately eliminate trade barriers on more than 99 percent of manufactured goods traded between the two nations.
“These votes are a tribute both to bipartisan cooperation by members of Congress and to President Bush’s strong commitment to opening markets overseas for American businesses, workers and farmers,” said U.S. Trade Representative Robert B. Zoellick.
The Senate Finance Committee yesterday also approved the Australia agreement. Democratic presidential candidate Sen. John Kerry of Massachusetts was one of 17 votes in favor of the pact. Four voted against it. The full Senate could vote as soon as today.
Mr. Kerry has supported opening trade through agreements such as the North American Free Trade Agreement and creation of the World Trade Organization (WTO). But last year he skipped votes on free-trade agreements with Singapore and Chile. And this year he criticized the administration for signing a Central American Free Trade Agreement with five smaller nations that he says don’t have adequate labor and environmental protections.
Yesterday, he also supported legislation that would create a U.S.-Morocco Free Trade Agreement, another deal signed by the administration and considered likely for passage this year.
The Bush administration has strongly supported a raft of new trade deals, looking to more than triple the number of pacts while struggling to create a 34-nation Free Trade Area of the Americas and new rules at the WTO.
Last year, it finished the Chile and Singapore deals, in the works since the Clinton administration, and has started talks with 19 other nations.
Australia is the United States’ 14th-biggest export market, buying more than $13 billion in goods last year, including aircraft, computer accessories, pharmaceuticals and medical equipment.
Australia’s major exports to the United States were meats, including beef and poultry, and wine.
The agreement allows the United States to cap Australian beef imports and offers limited access for Australian dairy products, but some lawmakers are worried that industries in their home states could be harmed.
The agreement also would be the first free-trade pact to create new rules specifically for pharmaceuticals, forcing some changes in Australia’s Pharmaceutical Benefits Scheme, a multibillion-dollar government system of subsidies for prescription drugs, and reinforcing patent protection for drug companies.
Some U.S. lawmakers said the agreement would prevent re-importation of American drugs from countries with lower-cost pharmaceuticals, an increasingly popular idea as a way to lower prescription costs in the United States.
“Some have suggested that this agreement would prevent Congress from changing U.S. law to allow the importation of patented U.S. pharmaceuticals. This is not correct,” John Veroneau, general counsel for the U.S. trade representative, said in a letter Tuesday to House lawmakers.
Australia’s House of Representatives has approved the agreement, and the Australian Senate is expected to vote on the pact as soon as next month.
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